AgriVisor Morning MarketWatch

Tuesday, June 08, 2021
As expected, the US corn crop rating declined last week. The crop is now rated 72% Good/Excellent, down 4 points on the week. The initial soybean crop ratings came in at 67% G/E which was at the lower end of expectations. Now that the report is out of the way, trade will focus more on positioning ahead of Thursday’s WASDE report. We are seeing wide ranges of estimates ahead of this, especially on Brazil’s corn crop. On the top side analysts are predicting a crop of 102 million metric tons which is equal to what the USDA published last month. Others claim the crop will be considerably lower, with some al the way down to 88 million metric tons. While these numbers are both possible, the general consensus is the crop with be closer to 97 million metric tons. We are seeing less interest in Brazil’s soybean crop as thoughts are this will hold steady and possibly increase from a month ago. Prior to the release of the WASDE data the firm CONAB will put their numbers out which will be closely watched as well. The question in the market is how long we will see these drive futures as more interest will start to fall on the month end reports, and of course daily weather forecasts and growing reports.  

* world internet outage being closely monitored
* Global market monitoring food grain supply
* Countries continue to raise export taxes
* US inflation expected to be temporary
* OPEC to maintain current oil production
* New crop demand well ahead of normal
* Processors rolling bids to deferred months
* Index roll pressuring spot contracts
* Energy demand back to pre-Covid levels 
* US ethanol stocks -26% from last year

* US corn rated 72% G/E
* Ethanol demand rising
* Ethanol values highest in 7 years
* Some firms holding Brazil crop at 102 mmt
* Argentine values well under US
* Initial crop rating at 67% G/E
* China shifting to soybean alternatives
* Chinese sunflower meal use up 30% in April
* India may remove veg oil import tax
* Soy oil continues to drive entire complex 

* Winter wheat 50% G/E
* Winter wheat 2% harvested
* Spring wheat 30% G/E
* Russian exports -1.1 mmt this year 
* Australian plantings +2% this year
* Cattle approaching seasonal high
* Cattle tends to peak in early June
* Low cattle inventory may offer support
* Hog futures expected to peak in late June
* Beef/Pork exports remain elevated  

RISK DISCLAIMER: The risk of loss in trading commodity futures and options is substantial. Before trading, you should carefully consider your financial position to determine if futures trading is appropriate. When trading futures and/or options, it is possible to lose more than the full value of your account. All funds committed should be risk capital. Past performance is not necessarily indicative of future results. The information contained in this report is believed to be reliable but is not guaranteed to accuracy or completeness by AgriVisor, LLC. This report is provided for informational purposes only and is not furnished for the purpose of, nor intended to be relied upon for specific trading in commodities herein named.  This is not independent research and is provided as a service.  As such, this is considered a solicitation.